The White House Council on Environmental Quality (CEQ) has proposed guidance to federal agencies regarding agency analyses of climate change under the National Environmental Policy Act (NEPA). The guidance replaces a prior draft that was issued in 2010 but never finalized.

NEPA mandates that federal agencies identify, evaluate and disclose to the public the environmental consequences of their proposed actions and consider reasonable alternatives thereto. The Act applies to virtually all discretionary federal decision-making — everything from general federal land management planning processes to the permitting of specific private energy generation and transmission projects.

Federal agencies are legally responsible for compliance with NEPA. But, as a practical matter, the Act's compliance costs and litigation risks are frequently borne by private project developers who have applied for federal permits.

For example, earlier this year the United States District Court for the District of Colorado invalidated a pair of mining lease approvals granted to private developers because the relevant federal agencies (there, the United States Forest Service and Bureau of Land Management) had failed properly to address climate change issues in their NEPA documents (High Country Conservation Advocates v. United States Forest Service, D. Col. Case No. 13-cv-1723).

The proposed guidance attempts to improve the efficiency and consistency of agencies' NEPA reviews (and, indirectly, to increase certainty for private project proponents) by setting forth a detailed series of instructions for addressing climate change in NEPA documents. Key aspects of the proposed guidance include the following:

  • The guidance recognizes that many federal agencies have concluded that their actions will have little impact on climate change because they are a small percentage of total greenhouse gas emissions, and warns that boilerplate statements along these lines are not sufficient to satisfy NEPA: "[T]he statement that emissions from a government action or approval represent only a small fraction of global emissions is more a statement about the nature of the climate change challenge, and is not an appropriate basis for deciding whether to consider climate impacts under NEPA."
  • The scope of an agency's analysis of climate change should not be limited to direct greenhouse gas emissions from specifically-permitted federal actions; analyses must also address upstream and downstream activities bearing a "reasonably close causal relationship" to those actions.
  • The guidance affirms a "rule of reason" (for which there is also support in case law) granting agencies considerable discretion to determine the nature and extent of their NEPA analyses. At the same time, however, the guidance clearly states that proposed actions with the potential to result in more than 25,000 MT CO2e per year should be the subject of quantitative analysis.
  • NEPA analyses prepared in connection with federal land management decisions (e.g., leasing plans, resource management plans, etc.) should address biogenic sources of greenhouse gas emissions.

Although CEQ's NEPA guidance is not a rule or regulation within the meaning of the Administrative Procedure Act, it is "persuasive" authority applicable to all federal agencies. And, in a somewhat unusual move, CEQ has "encouraged" agencies to apply the proposal to on-going NEPA reviews. There is no published timetable for finalizing the proposed guidance.